The Welsh Government has awarded £950,000 to develop a new riverside venue in Newtown, Deputy Minister for Housing and Local Government Hannah Blythyn has announced.

The £1.5 million project – to build an iconic, two-story building on the site of the former Radio Maldwyn studio in Newtown’s main car park – will be funded through the Welsh Government’s Transforming Towns Fund and the National Lottery’s Community Fund in Wales.

Hannah Blythyn said: “The Welsh Government wants to Transform Towns across Wales, making them fit for the 21st century. I’m really pleased the Welsh Government is supporting this new and exciting Riverside Venue development in Newtown with a £950,000 investment. This demonstrates our firm commitment to investing in Mid Wales.

“The building will offer something different to Newtown and provide a sustainable building where people can meet, congregate, relax, enjoy their surroundings and be entertained. Its location is key in supporting the town centre, as it is conveniently located between the town and open green spaces and will provide a link between the two.

“This project will add value to the wider work being undertaken to regenerate and revitalise the town and it is pleasing to see such a wide range of delivery partners and funders involved in the project.”

Groundwork for the new building is expected to start in early summer and is due for completion in a year.

The development is being delivered by Open Newtown, a community enterprise that aims to maximise the potential of the town’s green and blue spaces, in partnership with Powys County Council, Newtown and Llanllwchaiarn Town Council and National Lottery’s Community Fund in Wales.

In addition to securing employment through its construction phase, the Riverside Venue will create and secure additional jobs and support new and existing enterprises through its ongoing operations.

The new building will sit between a new destination play park and a BMX Pump Track and Mountain Bike Trail on Trehafren Hill, both partnership projects that have received funding from the town council and National Lottery Community Fund and Sport Wales.

The Riverside Venue will open up the River Severn and surrounding parkland to visitors and local residents, with canoe access points, nature/heritage trails and a forest/river school opportunity.

“This exciting, new development will see a transformation of a dilapidated building, turning it in to a sustainable, modern, fully accessible, mixed-use facility,” said Owen Durbridge, Open Newtown’s chairman.

“The building will act as a gateway to Newtown’s green spaces particularly for tourists interested in the town and wider Mid Wales. It will offer complementary services to what Newtown already has on offer, increase visitors and encourage them to spend more in the town.”

Social inclusion charity Siawns Teg, which rents the former Radio Maldwyn building from Powys County Council, will be re-located in Newtown and continue to work with the local community.

The Welsh Government’s investment follows a revised planning application and business plan submitted by Open Newtown, which took account of local feedback and consultations.

Powys County Council’s cabinet member for regeneration, Councillor James Evans said: “This is an important milestone in the redevelopment of a key area within Newtown. The investment support sends a clear signal that Newtown, the county’s largest town, is a place to do business and determined to provide an attractive environment for both residents and visitors boosting the economy.”

Guy Jones, funding officer at The National Lottery Community Fund, said: “We are delighted that Open Newtown has secured the grant from the Welsh Government.

“They have also consulted widely with the community and changed some of their proposals before submitting a revised planning application and business plan.

The new funding means that the total of around £1.5m is now secure to complete the build.”

Newtown’s Mayor Councillor David Selby welcomed the large investment in the town. “The Riverside Venue will be both a benefit to local residents and visitors to the town, ideally situated between the destination play park, the town’s main car park and town centre facilities.

“The town council will play its part in monitoring the development and its facilities as the project develops.”

Town Clerk Ed Humphreys said: “This project demonstrates how working in partnerships and being bold and innovative can access inward investment which might otherwise be unavailable.

“The message seems to be out that Newtown and Llanllwchaiarn is a place to invest, that the community seeks to increase its offer to residents and visitors alike and is prepared to try something new in order to do it.”

Gary Mitchell, who is leading the Riverside Venue and Destination Play Park projects for Open Newtown, said: “This level of investment and the fact this development is directly connected with new and existing assets of the town, will really help put our small, rural market town on the map in Mid Wales – a place I’m proud to call my home.”